Understanding the Different Types of Car Insurance in California
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Car insurance in California is meant to protect drivers, their vehicles, and others on the road. While the state sets minimum coverage requirements, many drivers choose extra coverage to protect themselves from accidents, theft, and natural disasters. Below, we'll take a look at the different types of required and optional insurance available in California to help you decide what you need for full protection.
Overview of California's Insurance Requirements
In California, every driver needs to have an auto insurance policy or show an accepted alternative proof of financial responsibility. The most common way to meet these legal requirements is by getting liability insurance. It's important to note that the state uses an at-fault system, meaning the driver who caused the accident has to pay for the damages. This coverage pays for injuries and property damage you cause to others in an accident.
California law requires all drivers to have a minimum amount of liability insurance:
- $15,000 for injury or death to one person
- $30,000 for injury or death to more than one person
- $5,000 for property damage
This coverage is designed to handle the costs of damage or injuries you cause to others but doesn’t cover your own injuries or car repairs. Drivers who don't meet these minimum insurance requirements might face fines, license suspension, or even have their vehicle impounded.
California’s Minimum Car Insurance Requirements
As mentioned, the only required insurance in California is liability coverage. This basic coverage is meant to address the fact that California is an at-fault state. This puts the responsibility on the driver who caused the accident to pay for the damages and injuries. While the previously highlighted figures are the state's bare minimum, it's often recommended to get more coverage for better financial protection.
In addition to personal liability coverage, many drivers purchase the following types of auto insurance coverage in California to provide more comprehensive protection:
- Uninsured/underinsured motorist coverage: With a lot of uninsured drivers in California, this optional coverage can help cover your costs if you're hit by someone with little or no insurance. It takes care of your medical bills and property damage in these cases.
- Collision coverage: This optional insurance covers damage to your vehicle if you're in an accident, no matter who's at fault. It's typically advised if you have a newer car or one that's financed.
- Comprehensive coverage: Comprehensive insurance covers damage to your car from theft, vandalism, or natural disasters. Alongside collision coverage, this makes up "full coverage" insurance, keeping your car protected from all sorts of risks.
Review the insurance requirements of your state:
Optional Coverages in California
California offers a variety of additional coverages that go well beyond basic requirements and standard protections. These options can further safeguard your investment and provide a heightened sense of security on the road.
- No-fault medical payments coverage (MedPay): While California doesn’t offer personal injury protection (PIP), MedPay is an available option. MedPay pays for medical expenses for you and your passengers, regardless of who’s at fault, and can be especially useful if your health insurance has high deductibles.
- Gap coverage: If your car is totaled in an accident and you owe more than the car is worth, gap insurance covers the difference between your car’s value and what you still owe on your loan.
- Self-insured and DMV cash advance options: California allows for self-insurance with a cash deposit option. More common among fleet owners or financially independent individuals, a $35,000 deposit must be made either directly with the DMV or as a surety bond from a company licensed to do business in California.
Determining the Right Coverage for Your Needs
Choosing the right car insurance coverage depends on a variety of factors, including the value of your vehicle, your personal risk tolerance, and whether you have a loan on the car. Start by meeting the state’s liability requirements, and then consider whether you need additional protection like collision or comprehensive coverage if you have a newer or financed car. If you're concerned about medical costs, MedPay might be a smart option to supplement your health insurance. For those leasing a vehicle, gap coverage can provide important financial protection.
Get the Right Coverage for Your Needs—Shop for Car Insurance Today!
Getting the right car insurance is essential for both legal compliance and financial protection. From minimum liability to full coverage, selecting the right plan can protect you from unexpected costs.
Take advantage of EverQuote’s easy-to-use comparison tool to find the best car insurance rates in California. Compare quotes now and get the coverage you need at a price that works for you.
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Premiums are sourced from over 30,000 zip codes across 200 insurance companies. We estimate premiums based on public filings for policies seeking 50/100 in liability with $500 deductibles for collision and comprehensive coverage. Estimated rates are based on a 35-year-old single female with a good credit score and no history of accidents or violations driving a 2023 Toyota RAV4 LE. We partner with Quadrant Information Services to source our data and assume no unique benefits or discounts are applied for these rates (unless otherwise stated). Your own rates may be different.